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The Daily Sentinel (Colorado): Oil shale companies lag behind Shell

By MIKE McKIBBIN
Tuesday, February 27, 2007

RIFLE — Community leaders and residents heard the latest about Shell Oil Exploration and Production’s oil shale test project in Rio Blanco County last week, but Rifle Mayor Keith Lambert wants to know what two other companies have planned as well.

Those companies, Chevron and EGL Resources, are not as far along as Shell, so do not have the same information to share with the public, according to EGL Operations Manager Roger Day.

Chevron and EGL Resources received 160-acre federal leases for oil shale research, development and demonstration projects last year, while Shell received three such leases. Shell has also been working at its own Shell Mahogany Project site in Rio Blanco County for the last several years and said last week they hope to decide to pursue a commercial oil shale project shortly after the next decade.

Lambert said he wanted the other energy companies “to communicate as well as Shell has.”

“We have so much to do to make sure we can meet the infrastructure demands, let alone the housing and social demands,” he said. “But until they come up with some good work force projections and the type of growth we might have to deal with, it’s hard to make our plans or say if we’ll be ready.”

“When we’re at a similar stage as Shell, we could” hold similar open houses, Day said Monday. “We have a lot of work to do to catch up with Shell.”

EGL plans to drill one core hole this year on its lease to measure and test the underground aquifer, Day said.

EGL hopes to boil oil out of shale rock at its site using electric heaters, similar to Shell’s patented process, along with steam generation boilers.

Chevron plans only minimal on-ground work at its lease site this year, company spokesman Dan Johnson said Monday.

“We’re approaching this very cautiously,” he said. “We have plans to drill only one well in 2007 to do water hydrology studies.”

Chevron is working with Los Alamos National Laboratory in New Mexico on its process, called Drill, Fracture, Heat and Produce. Underground oil shale rock would be fractured, crushed in place, then heated until oil can be recovered. The test phase will last anywhere from three to seven years, Johnson said.

Johnson said Chevron officials have met privately with elected officials in Garfield and Rio Blanco County communities.

“We want to take a slow, methodical approach,” he said. “We’re not talking about anything more than a research, development and demonstration project at this point. We’re going to nurture the process because we know it has to be done right.”

Mike McKibbin can be reached via e-mail at [email protected].

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